Smart Tips for Financial Planning

Start with a Strong Foundation

The first step is understanding where you stand. Begin by assessing your income, expenses, debts, and assets to create a net worth statement. What you’ll need to gather includes:

• Income & Expenses
• Debt
• Savings & Investments

Once you review these and get a clear picture, set SMART goals – those that are Specific, Measurable, Achievable, Relevant, and Time-bound. Goals provide direction and motivation, making it easier to stay on track.

Master Budgeting Basics

Budgeting doesn’t have to feel restrictive! The 50/30/20 rule is a simple and flexible framework: allocate 50% of your income to needs, 30% to wants, and 20% to savings. Explore different budgeting methods (apps, spreadsheets, or good old-fashioned pen and paper) to find one that fits your lifestyle. Remember, tracking expenses regularly is key to staying in control.

Save and Invest for Your Future

Building financial security starts with savings. When considering financial planning, you want to consider many different “buckets” of money. Once you fill one bucket, you can begin to fill the rest, or you can have several buckets ready to be filled all at once.

• Emergency Fund: Aim to create an emergency fund with 3-6 months’ worth of expenses. Remember, if filling a bucket seems improbable in your plan, look for creative solutions.  
• Retirement Planning: Within financial planning, retirement planning is most often associated with contributing to a 401k, A Traditional or Roth IRA, or any other form of retirement investment account. Retirement Planning is something most people consider, but the biggest takeaway should always be to take advantage of any employer match program and to enroll as early as possible.
• Investments: Investments can include stocks, bonds, even real estate. When investing, consider your risk tolerance, goals, and time horizon when making investment decisions. Start small but stay consistent.

Knowledge is power, but action makes change happen. Create a spending plan, prioritize savings, and review your insurance to ensure you’re protected.

You don’t have to do it alone. If you need a helping hand with your planning, our Financial Coaches are available to support you on your journey. Visit alivecu.coop/financialwellness to schedule or learn more.

This article is for informational purposes only and does not constitute financial advice.